Marginal note:Report respecting disclosure

673.3 The Superintendent shall prepare a report, to be included in the report referred to in section 40 of the Office of the Superintendent of Financial Institutions Act, respecting the disclosure of information by companies, societies, foreign companies or provincial companies and describing the state of progress made in enhancing the disclosure of information in the financial services industry.

Marginal note:Examination of companies, etc.

• 674. (1) The Superintendent, from time to time, but at least once in each calendar year, shall make or cause to be made any examination and inquiry into the business and affairs of each company, society, foreign company and provincial company that the Superintendent considers to be necessary or expedient to determine whether the company, society, foreign company or provincial company is complying with the provisions of this Act and whether the company, society or provincial company or the insurance business in Canada of the foreign company is in a sound financial condition and, after the conclusion of each examination and inquiry, shall report on it to the Minister.

• Marginal note:Examination need not be made annually

  (2) If, in the opinion of the Superintendent, the circumstances so warrant in the case of a company, a provincial company or a foreign company that is not a fraternal benefit society, the examination and inquiry may be made less frequently than annually but not less frequently than triennially.

• Marginal note:Examination need not be made annually

  (2.1) If, in the opinion of the Superintendent, the circumstances so warrant in the case of a society or a foreign company that is a fraternal benefit society, the examination and inquiry may be made less frequently than annually.

Prudential Agreements

Marginal note:Prudential agreement

675.1 The Superintendent may enter into an agreement, called a “prudential agreement”, with a company, society or provincial company for the purposes of implementing any measure designed to maintain or improve its safety and soundness or with a foreign company for the purposes of implementing any measure designed to protect the interests of its policyholders and creditors in respect of its insurance business in Canada.

Marginal note:Court enforcement

• 678. (1) Where a company, society, foreign company, provincial company or person

  • (a) is contravening or has failed to comply with a prudential agreement entered into under section 675.1 or a direction of the Superintendent issued to the company, society, foreign company, provincial company or person pursuant to subsection 676(1) or (3),

  • (b) is contravening this Act, or

  • (c) has omitted to do any thing under this Act that is required to be done by or on the part of the company, society, foreign company, provincial company or person,

  the Superintendent may, in addition to any other action that may be taken under this Act, apply to a court for an order requiring the company, society, foreign company, provincial company or person to comply with the prudential agreement or direction, cease the contravention or do any thing that is required to be done, and on such application the court may so order and make any other order it thinks fit.

Disqualification and Removal

Meaning of “senior officer”

678.01 In sections 678.1 and 678.2, “senior officer” means the chief executive officer, secretary, treasurer, controller or actuary of a company, society or provincial company, or any other officer reporting directly to its board of directors or chief executive officer.

Marginal note:Removal of directors or senior officers

• 678.2 (1) The Superintendent may, by order, remove a person from office as a director or senior officer of a company, society or provincial company if the Superintendent is of the opinion that the person is not suitable to hold that office

  • (a) on the basis of the competence, business record, experience, conduct or character of the person; or

  • (b) because the person has contravened or, by action or negligence, has contributed to the contravention of

    • (i) this Act or the regulations made under it,

    • (ii) a direction made under section 676,

    • (iii) an order made under subsection 515(3) or 516(4),

    • (iv) a condition or limitation in respect of the order approving the commencement and carrying on of business by the company, society or provincial company, or

    • (v) a prudential agreement entered into under section 675.1 or an undertaking given by the company, society or provincial company to the Superintendent.

• Marginal note:Risk of prejudice

  (2) In forming an opinion under subsection (1), the Superintendent must consider whether the interests of the policyholders and creditors of the company, society or provincial company have been or are likely to be prejudiced by the person’s holding office as a director or senior officer.

• Marginal note:Representations may be made

  (3) The Superintendent must in writing notify the person concerned and the company, society or provincial company of any removal order that the Superintendent proposes to make under subsection (1) and must afford them an opportunity within 15 days after the date of the notice, or within any longer period that the Superintendent allows, to make representations to the Superintendent in relation to the matter.

• Marginal note:Suspension

  (4) If the Superintendent is of the opinion that the public interest may be prejudiced by the director or senior officer continuing to exercise the powers or carry out the duties and functions of that office during the period for making representations, the Superintendent may make an order suspending the director or senior officer. The suspension may not extend beyond 10 days after the expiration of that period.

• Marginal note:Notice of order

  (5) The Superintendent shall, without delay, notify the director or senior officer, as the case may be, and the company, society or provincial company of a removal order or suspension order.

• Marginal note:Consequences of removal order

  (6) The director or senior officer, as the case may be, ceases to hold that office as of the date the removal order is made or any later date specified in the order.

• Marginal note:Appeal

  (7) The director or senior officer, as the case may be, or the company, society or provincial company, as the case may be, may, within 30 days after the date of receipt of notice of the removal order under subsection (5), or within any longer period that the Court allows, appeal the matter to the Federal Court.

• Marginal note:Powers of Federal Court

  (8) The Federal Court, in the case of an appeal, may dismiss the appeal or set aside the removal order.

• Marginal note:Order not stayed by appeal

  (9) A removal order is not stayed by an appeal.

Marginal note:Application

• 678.3 (1) This section applies only in respect of a foreign company

  • (a) that has been notified by the Superintendent that this section applies to it where the foreign company is subject to measures designed to protect the interests of its policyholders and creditors in respect of its insurance business in Canada, which measures

    • (i) have been specified by the Superintendent by way of conditions or limitations in respect of the order approving the insuring in Canada of risks by the foreign company, or

    • (ii) are contained in a prudential agreement entered into under section 675.1 or an undertaking given by the foreign company to the Superintendent; or

  • (b) that is the subject of a direction made under section 676 or an order made under subsection 608(4) or 609(2).

• Marginal note:Information to be provided

  (2) A foreign company shall provide the Superintendent with the name of any person who has been selected by the foreign company for appointment as chief agent together with such other information about the background, business record and experience of the person as the Superintendent may require.

• Marginal note:When information to be provided

  (3) The information required by subsection (2) shall be provided to the Superintendent at least 30 days prior to the date of the appointment or within any shorter period that the Superintendent may allow.

• Marginal note:Disqualification

  (4) If the Superintendent is of the opinion that, on the basis of the competence, business record, experience, conduct or character of a person, he or she is not suitable to hold the position of chief agent, the Superintendent may, by order, disqualify the person from being appointed to that office.

• Marginal note:Risk of prejudice

  (5) In forming an opinion under subsection (4), the Superintendent must consider whether the interests of the policyholders and creditors of the foreign company in respect of its insurance business in Canada would likely be prejudiced if the person were to take office.

• Marginal note:Representations may be made

  (6) The Superintendent must in writing notify the person concerned and the foreign company of an order that the Superintendent proposes to make under subsection (4) and must afford them an opportunity within 15 days after the date of the notice, or within any longer period that the Superintendent allows, to make representations to the Superintendent in relation to the matter.

• Marginal note:Prohibition

  (7) If an order is made under subsection (4) disqualifying a person from being appointed as chief agent, the person shall not be, and the foreign company shall not permit the person to be, appointed to that position.

Marginal note:Removal

• 678.4 (1) The Superintendent may, by order, remove a person from office as the chief agent of a foreign company if the Superintendent is of the opinion that the person is not suitable to hold that office

  • (a) on the basis of the competence, business record, experience, conduct or character of the person; or

  • (b) because the person has contravened or, by action or negligence, has contributed to the contravention of

    • (i) this Act or the regulations made under it,

    • (ii) a direction made under section 676,

    • (iii) an order made under subsection 608(4) or 609(2),

    • (iv) a condition or limitation in respect of the order approving the insuring in Canada of risks by the foreign company, or

    • (v) a prudential agreement entered into under section 675.1 or an undertaking given by the foreign company to the Superintendent.

• Marginal note:Risk of prejudice

  (2) In forming an opinion under subsection (1), the Superintendent must consider whether the interests of the policyholders and creditors of the foreign company in respect of its insurance business in Canada have been or are likely to be prejudiced by the person’s holding office as chief agent.

• Marginal note:Representations may be made

  (3) The Superintendent must in writing notify the chief agent and the foreign company of any removal order that the Superintendent proposes to make under subsection (1) and must afford them an opportunity within 15 days after the date of the notice, or within any longer period that the Superintendent allows, to make representations to the Superintendent in relation to the matter.

• Marginal note:Suspension

  (4) If the Superintendent is of the opinion that the public interest is likely to be prejudiced by the chief agent continuing to exercise the powers or carry out the duties and functions of that office during the period for making representations, the Superintendent may make an order suspending the chief agent. The suspension may not extend beyond 10 days after the expiration of that period.

• Marginal note:Notice of order

  (5) The Superintendent shall, without delay, notify the chief agent and the foreign company of a removal order or suspension order.

• Marginal note:Consequences of removal order

  (6) The chief agent ceases to hold that office as of the date the removal order is made or any later date specified in the order.

• Marginal note:Appeal

  (7) The chief agent or the foreign company may, within 30 days after the date of receipt of notice of the removal order under subsection (5), or within any longer period that the Court allows, appeal the matter to the Federal Court.

• Marginal note:Powers of Federal Court

  (8) The Federal Court, in the case of an appeal, may dismiss the appeal or set aside the removal order.

• Marginal note:Order not stayed by appeal

  (9) A removal order is not stayed by an appeal.